Britain is becoming a 'why bother country'

By Paul Stokes

12:01AM BST 21 Apr 2008

Britain is suffering from a "why bother" economy because its benefits culture, high taxes and poor education system leave many people lacking the motivation or capability to succeed, according to a report.

The cost to the economy of low social mobility is £32 billion a year, or £1,300 to the average family, claims Reform, the independent think tank.

This comes despite higher spending on benefits and public services that have served only to reinforce privilege, it says.

Child poverty has risen, with the number of children classified as low income rising from 2.4 million to three million.

State schools stand accused of a "dismal" record when it comes to educating the poorest in society, with school-leavers from poor backgrounds doing only half as well as average 16-year-olds.

There is also a geographical division, with three times the number of people in parts of northern England claiming disability benefits than in the South East.

Prof Nick Bosanquet, the report's lead author, said: "We need an agenda to get the roadblocks to social mobility down… Every person failed by the education system and held back by the tax and benefits system means that the economy cannot fulfil its potential."

The report concludes: "Public services are biased towards the affluent, and means-tested benefits and higher tax have reduced individuals' incentives to increase their incomes. The unintended consequence has been a 'why bother' economy in which a significant minority do not have the capability or motivation to succeed."

Reform is asking for a co-ordinated approach to policy that would encourage individuals, with less government intervention and lower taxation.